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The CITE, a blog published by the National Association of College Stores, takes a look at the intersection of education and technology, highlighting issues that range from course materials to learning delivery to the student experience. Comments, discussion, feedback, and ideas are welcome.

Tuesday, June 10, 2014

DRM Keeps Amazon in Driver's Seat

The contract tussle between Hachette and
Amazon has been all over the news of late, but the problem is more than Amazon’s
tactics. It’s the deal with the devil publishers signed up for years ago when
they decided proprietary digital rights management (DRM) was the way to go,
according to Ben Thompson in a Bloomberg News article.

Thompson, founder of Stratechery.com, a
blog about the business and strategy of technology, wrote that since publishers
were so worried about allowing free access to their content, they ended up
putting Amazon in the negotiating driver’s seat.

“The problem with DRM, as Nook owners now
know all too well, is that it ties your books to a single company,” Thompson
wrote. “If you start buying Kindle books, you will always buy Kindle books,
because your books will only ever work on a Kindle app.”

Thompson said he thinks publishers could
change the balance of power by eliminating proprietary DRM.

“To be sure, this digital future would
require a new business model,” Thompson wrote. “Publishers would need to rework
their businesses from speculative investment to publishing-as-a-service, with
upside directly tied to a book’s success.”

Such change might be difficult. In fact,
George Packer wrote in an article for The New Yorker that Amazon executives believe publishers are so woefully
behind the times that they probably will never catch up.

“I’ve worked with publishers, and here’s
the thing: Amazon is largely right,” Thompson said. “Publishers, as currently
constructed, simply aren’t prepared to compete in a world based on Internet
economics.”